Cash machine group sold to private equity

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The Independent Online

Scott Tod, the troubled cash machine operator, has agreed to be taken over by the private equity fund Rutland Partners in a deal that values the AIM-listed company at £7.4m.

Rutland will buy the company through Notemachine, a new vehicle set up for the deal, to be run by Peter McNamara, the former chief executive of Moneybox, one of the UK's largest independent cash machine operators until it was itself taken over last year by the rival Cardpoint.

Scott Tod floated on AIM in 2003 at 25p a share but has since struggled to make inroads into the increasingly competitive fee-charging cash machine market. The 21p-a-share offer from Rutland represents a 56 per cent premium to the price prior to the announcement of the deal. Last night its shares closed at 19.25p.

The deal will result in large windfalls for the current directors of Scott Tod and the Tod family, who founded the company in 1978.

Scott Tod's board is led by the chairman David Massie, who will receive £1.53m for his holding in the company. The Tod family, meanwhile, have agreed to sell their 25 per cent stake for £1.86m.

Mr Massie and the Tods have been involved in a long-running spat over how the company is run. Earlier this year, at a rancorous annual meeting, the board narrowly defeated an attempt by the family to regain a management role.

Last year, the company lost £1.1m after a poor performance from its network of about 2,000 cash machines, which is primarily located in Wales.

Mr Massie said yesterday: "The published results of Scott Tod in recent times have not met the hopes of shareholders ... This offer provides an exit in cash for those who wish to pursue alternative investments."

The appointment of Mr McNamara to run Notemachine prompted speculation that Rutland is considering further investments in the cash machine market, which has consolidated rapidly over the past 18 months.

Michael Langdon, the chairman of Rutland, said: "Scott Tod has struggled for the last 12 months and has suffered senior management upheaval. Rutland will be bringing in Peter McNamara, who has considerable experience in this sector."

Earlier this year, Cardpoint, which paid £90m for Moneybox last summer, revealed it had been approached by a potential bidder, though last month it said the talks had collapsed.

Cardpoint is the UK's largest remaining independent operator of fee-charging cash machines, with a network of about 4,500 ATMs. The biggest player in the market, Hanco, with more than 7,000 cash machines, was bought last year by Royal Bank of Scotland for £80m.

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